BMW, VW’s
Audi and
Porsche, and Mercedes have invested huge sums to produce plug-in hybrid electric vehicles, but one German expert believes this is a big mistake, and
Tesla Motors’ all electric approach is already eating into their high-end sales.

According to Professor Ferdinand Dudenhoeffer, director of the Center for Automotive Research (CAR) at the University of Duisburg-Essen, not only have the big three Germans wasted money on the blind-alley of plug-in hybrids, they are losing sales in the most profitable end of the luxury market to Tesla. Rich people who have formerly bought the flag-ship Mercedes S-Class, BMW 7 Series and Audi A8 are turning to the Tesla Model S.

Plug-in hybrids harness an internal combustion engine to a battery powered electric motor. The battery-power typically allows up to about 30 miles of electric-only driving, while the gasoline engine has the range of a traditional motor. The battery can be recharged independently, or, while free-wheeling on the road. The battery on regular hybrids can’t be charged independently and only allows maybe one mile of battery-only operation. The problem is the two power plants add a huge amount of weight. The complexity adds big extra costs.

But in the race to provide green buyers with much better fuel consumption and lower carbon dioxide (CO2) emissions, plug-in hybrids were thought to have the inside track on battery-power, at least until fuel cells become competitive by around 2025.

IHS Automotive recently looked again at its medium to long-range forecasts and raised its prediction for battery-only vehicles in 2020 a bit to just one per cent of the global market from just under one per cent. This will creep up to 1.5 per cent by 2025. IHS Automotive said hybrids and plug-in hybrids market share will rise to seven per cent in 2020 from a previous estimate of almost five per cent, and accelerate to 16 per cent from its previous prophecy of just over six per cent in 2025.

But according to Dudenhoeffer, this isn’t going to happen. Plug-in hybrids are not proving popular with buyers. They are also seen as not very environmentally friendly because most plug-in hybrid drivers will use internal combustion engine power for most the time.

In a report called “Tesla asserts itself in the luxury class,” Dudenhoeffer said that even in markets like Germany and Switzerland where there are no subsidies for electric vehicles, the Tesla Model S is grabbing sales from the likes of the Mercedes S class.